New Economy, New Wealth
prezi.com
prezi.com
When I can eat or live in a piece of information, then I'll start buying new paradigms with my ears pinned back.
All this talk about new economy is a bit old. While I'm impressed about the presentation - that's a very impressive way of showing things - and I agree that command-and-control architecture is done and dusted by sharing and open information models - this whole thing about information being more important than factories is a bit far-fetched.
Perhaps for some growth areas of the economy a completely information-based perspective is not only vital, but valid. Maybe more millionaires and billionaires will be minted by clever use of information and digital data. But the majority of the worlds production and income will still be found in digging things around.
However, the 'old economy' business of digging things up out of the ground, planting plants and harvesting them, and melting down base minerals to make things from is not going to change. You can layer all types of fancy new diagrams on top of this, but it's not going to change the base.
The big indicator should be that the 3 foundations of the current system, as described in the presentation - can all be exchanged for each other. Land for Captial, Capital for Labour, Labour for Land. Try exchanging information for any of these, you won't have much luck, unless we're talking trade secrets or blackmail. Try exchanging open information for a piece of land and see how you get on.
Even an iPad has to be made out of stuff dug out of the ground and refined in some way, then shipped across the ocean in an ancient old bit of technology called a ship. That's where the real story in the world economy is, that's where it will remain. Moving information around is just playing with the surplus production given to us by efficient manufacturing and agriculture.
If you want the real story on where things are headed, you'd best study things like the baltic dry index, the yield curve and old economy indicators like that. Measuring things in terms of eyeballs, mindshare and information flow is as terminally ridiculous now as it was 10 years ago when this was discredited the first time around.
I was at an AR devcamp a bit ago and heard endless effusion over Android and the Maker movement and Open Source and all the ways the hacker community was seizing its own destiny - the problem is, the entire practice is built on top of nationwide wireless data networks delivering internet content to smart phones. If ever there were a more capital-reliant industry, I don't know it.
I agree that an information-based industry obeys different economic rules than physical goods trading - the concept of scarcity applies only in terms of creation, not replication or distribution - but it'll no sooner wipe out the industrial economy than the industrial economy wiped out the agricultural economy.
Governments give literally acres of land and tax breaks and concessions and fall all over themselves when some techie company or other opens a call center. That is literally trading little old information for all three. I give you my domain knowledge and you give me labor (call center workers), land (um, land), and capital (tax incentives/breaks/concessions, whatever you wanna call it... cash).
Microsoft, aside from outsourced Flextronics-made XBox 360s and Zunes, make information.
"Moving information around is just playing with the surplus production given to us by efficient manufacturing and agriculture"
Moving information around is how you can use your Idaho bank card in Bangalore. It doesn't make your bank worth less than Juanito the beet farmer in Brazil.
Thank you for proving my point. Without Juanito the beet farmer, and the stereotypical mid-western farmer or Texan oil-man being efficient and extracting a profit from their activities, there is no surplus. Without the beets (and wheat,and beef, etc) none of us get fed. Without piles of invested long-term capital from capital markets you don't have trans-ocean cables, and without that you don't have any way of talking from Bangalore to Idaho. Without the mines to dig up the minerals you don't have planes, and without oil wells you don't have fuel, without pilots and baggage handlers you don't get to go to Bangalore. So you wouldn't need your bankcard.
The whole reason we can actually get to Bangalore to use our bank card is because those in primary production do it efficiently enough that not all of us are involved in doing it. That's the surplus production (and thus, wealth) that allows us to do these things.
Look, I'm not anti-tech in the slightest - this is how I make my living. I'm just imploring tech people not to lose touch with that the industry really is, not to let your fee lose touch with the ground and the real economy that we're all here to support and improve.
I did not manage to see the presentation, but I suppose it depends as to how you define importance. We might always need farmers, wood smiths, brick layers. However, we know how to farm the land, build kitchens, houses. These things demand skill, but of a very low level.
Perhaps such things should not be placed in a hierarchical pyramid, but if they were, information would be right at the top. That is so as information, or rather innovation that comes from information and synthesis of information affects all that is below it in the hierarchy and is the hardest to get in that hierarchy.
You're being unnecessarily skill-ist here. I don't expect a farmer to build a website, and I certainly wouldn't know the first thing about bringing a wheat crop to market. Similarly, I've tried to build a kitchen and find that trained, experienced professional is the best input for that job. To suggest that there are no more improvements to be found in construction, agriculture and other primary industries is to be very dismissive of the people working hard in those industries.
It's true that, say, programming requires a higher level of abstract thought and more mathematical-style skills. That's a different mix of skills than, say, a builder. But if you think you're better than that builder, you're just falling for cultural bias centered around universities that influence their undergraduates. Well, guess what, builders also talk around the site and consider themselves better than those who wasted their money at university. Neither is right.
'Til then I think I'll stick to cold hard cash.
It's the future, folks. That's what this entire site is about.
The information on patching an open source webserver is freely available. The skill (and available time) is what people will pay for. It's not the same thing as paying for information. It's hard to get people to pay for information. Paywall sites generally struggle unless they can find some information that gives an advantage, but then, the presentation talks about the value of free and open information, which nobody will pay for.
No-one is doubting that much of the activity on this site isn't important, or exciting. Just that it's wise to take a dose of reality along with the hype, otherwise you'll end up with sock puppet marketing all over again. Maybe you weren't part of the industry when it all went down the first time, but I still cringe at the billions of dollars wasted on business plans and ideas with no basis on reality, some of which quite openly stated that the 'old' economy was no longer worth anything at all.
Red Hat trades and works quite freely in open source software. It's information is out there for everyone to use, change, fork, recompile, remarket, etc (for example, CentOS for a free alternative or Oracle's Unbreakable Linux for pay).
They're heading toward a billion dollars in revenue, probably within 3-5 years, and are continually profitable.
This is the same economy you use in local situations - with neighbors, friends, co-workers - to exchange favors. It has the power to get you a job, or to make a deal, or to elect a president, or any number of other things that determine how the work is done and how the goods are dealt out. The agricultural through industrial economies downplayed this form of economic activity because property, ownership and employment proved more suitable for creating an efficient market, but sharing has always been present and has always been taught as a moral ideal. If we didn't participate in that economy, we'd be quite a stand-offish, non-collaborative bunch. Nobody would trust each other.
What we have now is the ability to make gift economies based on information global in scale. The capital and labor necessary to start your (scarcity economy oriented) startup are potentially sitting right here on HN, if you know what to say and who to say it to. And PG and co. aren't making money off of the site, but I'm sure they've benefited from it. It's this kind of value that is really what's at stake in a successful info-business venture - the ability of companies to monetize on top of the info or info infrastructures ultimately isn't as important to the economy as the benefits accruing to all of society from just having it around and operating smoothly; finding a reasonable doorway from abundance currency to scarcity currency is what has led to the variety of monetization concepts tried over the last decade(ads, freemium, subscription, paywall, patronage...). This problem of monetization is pervasive throughout information products and is at the root of the whole IP debate: If there weren't money in trading information, would the incentives to create still be there?
But the question that isn't answered by these slides is the big one: how to balance ownership-based markets with gift-based ones. While the gift economy is endlessly abundant, how will we distribute the work for the older markets as they grow more efficient? Are there enough jobs to go around now, or do we need to rearrange ourselves to sustain heightened unemployment? How do we make everyone materially wealthy enough to be happy, and not destroy the planet in doing so?
Bitcoin is a decentralized crypto-currency system with a very vibrant community and several enterprises. It's also a system in which nodes trust no one and verify all transaction in the network. http://bitcoin.org
Austrian school and other economic models are not obsolete at all. Their tools just need to be shifted to analyze the information realm. In fact, Austro-libertarians in general already reject intellectual property.
Indeed, the system paradigram is beginning to replace the old system of nation states and coercion and replace them with anarchistic law system meditated by computers. Computer code will be law.
The world is starting to look more like the Diamond Age, everyday.
More efficient computers will mine more bitcoins in the short run, but not any more in the long run.
Even if it is extremely efficient, it is probably a lot easier to just trade for bitcoins.
beside, the point of bitcoin is not generating bitcoins. In fact, generating bitcoins does nothing to create any value. Bitcoins become more valuable when you can trade goods for it.
Some guys get more chance at making the correct calculation that get him new bitcoins. Big deal. He get to buy 50 bitcoins worth of stuff. That's not a lot considering the exchange rate. Maybe it's 4 dollars at most. Don't forget that it won't be 50 bitcoins forever everytime you solve a problem. It will eventually be reduced to half and then half until nothingness years later. 21 million bitcoin limit. No more can be generated.
Maybe it will be more rewarding to generate bitcoins when bitcoins are in extremely high use, but that mean more competition for mining bitcoins. All that does is increase the difficulty to the point of becoming unprofitable.
Maybe I'm too cynical.. Any idealists want to cheer me up?
Or not. Adobe flash player 10 under Fedora 12. Should I try from a Windows box at work in the morning?
They didn't fix this since over a year now.